Although the public debate on poverty issues is frequently emotional. Why So Many Children Are Poor. David M. Betson Robert T.

Size: px
Start display at page:

Download "Although the public debate on poverty issues is frequently emotional. Why So Many Children Are Poor. David M. Betson Robert T."

Transcription

1 25 Why So Many Children Are Poor David M. Betson Robert T. Michael Abstract According to the official U.S. measure of poverty, in 1995 the child poverty rate in this country was nearly 21%, compared with an adult poverty rate of 11%. This article explores why, according to the official measure, there are so many poor children. Working from the premise that children are poor because they live with poor adults, the reasons for adult poverty are reviewed. Both economic forces and demographic trends have contributed to growing inequality of earnings among workers. That inequality coupled with stagnating real earnings has increased poverty. In addition, education, age, and race affect an individual s earning capacity; the article examines the likelihood that an individual will earn enough to keep his or her family out of poverty, given the individual s educational attainment, age, and race. The reasons for the large difference between the child and adult poverty rates are explored, using a decomposition of the poverty population to show how demographic characteristics such as higher fertility rates among poor families and the higher prevalence of singleparent families among the poor lead to substantially higher poverty rates for children than for adults. Finally, the article examines the validity of the official poverty measure and reviews how an alternative measure proposed by a National Research Council panel would address the official measure s shortcomings. If the panel s proposed measure were adopted, it would change the statistical face of poor children. It would, for example, show an increase in the proportion of poor children who live in families with two parents and a corresponding decrease in the proportion in families with only one parent, and it would show an increase in the proportion of children who live in families with at least one full-time employed adult and a corresponding decrease in the proportion in families with no adult employed full time. David M. Betson, Ph.D., is an associate professor of economics at the University of Notre Dame. Robert T. Michael, Ph.D., is the Eliakim Hastings Moore Distinguished Service Professor at the Irving B. Harris Graduate School of Public Policy Studies at the University of Chicago. Although the public debate on poverty issues is frequently emotional and acrimonious, it is clear that an informed debate over policies to prevent or ameliorate the consequences of poverty for children requires an understanding of how poverty is measured, of the composition of the population of poor children, of the reasons for childhood poverty, and of the ability of public and private programs to address the needs of poor children. These issues are the focus of this issue of The Future of Children. To help frame the discussion of developing effective child-focused poverty policies, this article describes how poverty is officially defined in the United States, reviews recent trends in poverty according to that definition, The Future of Children CHILDREN AND POVERTY Vol. 7 No. 2 Summer/Fall 1997

2 26 THE FUTURE OF CHILDREN SUMMER/FALL 1997 and discusses the reasons for the widening gap between child and adult poverty rates. In addition, it also derives implications for policy and discusses how the official definition of poverty might be improved to reflect more accurately the real resources available to children living at the lower end of the economic spectrum. The concept of poverty is simple and familiar: a child living in poverty lacks goods and services considered essential to human well-being. However, devising an operational measure of poverty that accurately reflects a child s well-being in terms of his or her economic resources is complex. A child s well-being depends both on how many resources are available to his or her family and on how the adults in the family allocate those resources among family members. Resources include the goods and services purchased for the child by the family, those provided by the government, and those produced within the family. In the United States, families and individuals are classified as being in poverty if their annual money income (including cash earnings, unemployment insurance benefits, cash benefits from other government programs, and other sources of regular nonearnings income) before taxes and other deductions falls below official poverty thresholds. These thresholds were developed in the mid-1960s; they are adjusted annually for inflation. One set of thresholds reflects the needs of families by size and composition. For example, the 1995 poverty threshold for a single individual was $7,929 while for a family of four (two adults and two children), the threshold was $15,455, and for a family of six (with two adults and four children), the threshold was $20,364. The trend in poverty for all adults (age 18 and over) and all children in the United States over the past three decades is presented in Figure 1. Four characteristics of child poverty stand out: (1) the rate of poverty for children is currently around one in five children; (2) since the late 1950s, there has been a consistently higher rate of poverty for children than for adults; (3) after declining steadily from 1959 through 1969, the poverty rate for children increased by more than 50% by 1983, and the gap between the poverty rates for children and for adults also increased substantially during the same period; and (4) for the past decade, the poverty rate for children has fluctuated around 21%. 1 The first section of this article discusses why child poverty is currently so high relative to adult poverty. The second section discusses the trends seen in Figure 1. As discussed in the spring 1993 issue of The Future of Children, the methods used by the federal government to measure poverty have been criticized almost since the government adopted its official measure in The National Research Council (NRC) of the National Academy of Sciences has recently recommended a major revision of the measure. While the official measure indicates the extent and character of poverty among children, it is flawed because it does not reflect the impact of many existing federal welfare programs such as food stamps, public housing, school lunch, energy assistance, or Medicaid. The third section describes these flaws and the NRC s recommended new measure of poverty and indicates how this new measure would alter the picture of which children are poor.

3 Why So Many Children Are Poor 27 Although flawed, the official poverty measure is important because it is the reference point for discussions of and research on poverty, including the papers in this issue. Moreover, the transition from the old measure of poverty to a new measure has not yet taken place. Thus, for setting a frame of reference, the official measure is used in the first three sections of this article. Recent events increase the need for the adoption of a new measure of poverty. The enactment of the 1996 welfare reform law, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, shifts much of the responsibility for those with inadequate incomes from the federal government to state governments. As states adopt different strategies in response to their new responsibilities, the measurement of child poverty will become increasingly important. It will be essential to learn from the states efforts which programs work well and which ones work poorly. But to learn from these diverse state initiatives, a clear, internally consistent, and comprehensive measure of poverty will be needed. Thus, the need for a better measure has become more urgent. The NRC s recommendations provide such a measure of poverty. While the focus of this article and of most policy-oriented discussions of poverty is on the official poverty measure, it is worth noting that some policy issues cannot be addressed by a metric that simply classifies families and individuals as poor or nonpoor. For example, the differences in incomes among poor families are not reflected in the simple count of those who are poor; families that have resources well below the poverty threshold present different circumstances and different policy challenges than ones with incomes just below the poverty threshold. Also, although the focus here is on the children who are below a poverty threshold, there is, of course, much inequality of income among the four out of five children who are not poor. Focusing exclusively on poor children ignores the inequality among children in middle- and upper-income families. Finally, looking at which children live in families above or below a poverty threshold at one point in time tells us little about the lifetime or long-term experience of those counted as poor. The consequences of the duration of poverty suffered by a child are discussed in the articles by Corcoran and Chaudry and by Brooks-Gunn and Duncan in this journal issue. Reasons for Child Poverty The major question of this article is why, according to the official measure of poverty, more than 20% of the nation s 67 million children are poor. There is no single answer to this simple, but perplexing, question. Children live with adults and rely upon those adults for their economic well-being. By and large then, children are poor because they live with adults who are poor. Thus, to understand child poverty one must look to the causes underlying adult poverty, such as economic and demographic forces and factors affecting individual earning capacity. The rate of poverty for children is almost double that for adults, as shown in Figure 1, so it is necessary to examine why children are more likely than adults to reside in poor families. A decomposition of the population of poor families by demographic characteristics, such as number of adults and number of children per family, sheds some light on this question. Children Born to Poor Adults When considering the ability of adults to meet the needs of their families, a distinction is made among three groups: adults who are family self-sufficient, those who are adult self-sufficient, and those who do not even

4 28 THE FUTURE OF CHILDREN SUMMER/FALL 1997 Figure 1 Child and Adult Poverty Rates, 1959 to Percentage Poor by Official Measure Year Child Poverty Rate Adult Poverty Rate Source: U.S. Bureau of the Census. Poverty in the United States: Current Population Reports, P-60, no Washington, DC: U.S. Government Printing Office, September attain adult self-sufficiency. Adults are defined as family self-sufficient if their own resources (their income and their receipts from social insurance programs that are not dependent on the presence of children) are enough to keep their entire family out of poverty. Self-sufficient adults are defined as those who would have enough resources to maintain themselves above the poverty threshold if their children were not present but do not have enough to meet the additional needs of their children. This difference is reflected in the poverty thresholds for families of varying sizes. In 1995, the threshold was $10,205 for two nonelderly adults, and it was $15,455 if two children were included in this family. Using this terminology, an adult couple with an income of $12,000 in 1995 and two children would be classified as adult self-sufficient but not family self-sufficient because they would have had sufficient resources to exceed the official poverty threshold for two adults but not enough to meet the poverty standard for a family of two adults and two children. Clearly, the distinction being drawn here is only a first approximation, but it is a useful one. 3 Using data from the March 1993 Current Population Survey (CPS), a monthly survey of about 60,000 households in the United States carried out by the Census Bureau, it is possible to determine the percentage of adults who live in families at each of these three levels of sufficiency. 4 In 1992, some 10.2% of adults in families with children lacked adult self-sufficiency. Because 10.3% of adults without children are also classified as poor, it appears that adults who live with children are not more likely to be poor than a random sample of all adults. In addition, 5.5% of all adults with children were adult self-sufficient but failed to achieve family self-sufficiency. Based solely on the resources brought to the family by the adults, therefore, a total of 15.7% (= ) of all adults with children did not meet the needs of their families and would have been counted as poor in 1992 were it not for government cash welfare programs designed for children. The impact of these cash programs is discussed below. Why Are These Adults Poor? The determinants of adult poverty can be classified into two general categories:

5 Why So Many Children Are Poor 29 (1) macroeconomic and demographic forces which affect the overall income distribution and (2) factors that affect an individual s earning capacity, such as education, age, and race. 5 Economic and demographic forces. Over the past three decades, there has been an increase in the inequality of earnings among workers, resulting in a larger proportion of the population in poverty. The rise in inequality might not have led to higher poverty rates among adults if it had been accompanied by a substantial rise in the average level of real (inflation-adjusted) earnings, but in these past two decades, average real earnings have not grown much. Traditionally, unemployment has been a major factor influencing the poverty rate, 6 but despite the fact that unemployment has fallen by nearly one-third since 1983, the low and declining wages of less-educated workers have led to greater poverty. The major demographic trends of the past several decades are dramatic growth in the proportion of women who are in the labor force and the entry of those born during the baby boom. Together, these two groups contribute to a younger and more female-intensive workforce. The young have less job experience and, thus, receive lower wages, and females traditionally have experienced lower earnings, so both of these demographic factors have tended to create greater inequality in earnings. With regard to family income, however, the contributions of women s earnings to two-income families may have partly offset the trend resulting from greater inequality of individual earnings. Individual earnings capacity. Education, race, and age are among the personal factors that most affect earnings and income; they play a role in determining which and how many families are poor. Education level is an indicator of market skills that yield higher earnings; age proxies for job skills acquired through experience; and race, because of discrimination, affects both job market opportunities and payoffs. Table 1 demonstrates the association between each of these characteristics and an adult s ability to attain adult self-sufficiency. The education of the adults in the family is critical for the family income. The proportion of adults who are not in the labor force and the proportion who experience at least one period of unemployment during the year both decline dramatically as education rises. For example, the proportion of high school graduates who are not adult selfsufficient (10%) is less than half the proportion of nongraduates who are not adult selfsufficient (24%). The education panel of Table 1 shows that the distribution of adults and of children by the education level of the primary person in the family are, surprisingly, almost identical. 7 The age panel reminds us that children live with relatively young adults who have not Education, race, and age are among the personal factors that most affect earnings and income; they play a role in determining which and how many families are poor. typically reached their peak earning capacity and are (except for the retired elderly) relatively less likely to be adult self-sufficient; this is especially true for those under age 25, which helps explain in part the social concern about teenagers having children. Race also has a strong relationship to poverty. As compared with whites, black adults have lower earnings on average and are more likely to be unemployed or out of the labor force. The race panel of Table 1 shows that black adults are three times as likely as white adults to have incomes that are too low to meet even the adult s needs in the family. While each factor education, age, and race separately can greatly influence an adult s chances of being able to support the adults in the family, let alone the children as well, consider the chances of a young, black, high school dropout. An adult with these three attributes has a 15% chance of being adult self-sufficient. However, a young black who graduates from high school has a much higher (42%) chance of being adult self-sufficient. 4 The Role of Federal Government Cash Assistance As discussed above, in 1992, a total of 15.7% of adults who lived with children did

6 30 THE FUTURE OF CHILDREN SUMMER/FALL 1997 Table 1 Distribution of Adults and Children by Characteristics of the Primary Person in the Family Adults Percentage Characteristics Adults Children Percentage Not Adult Average Out of Percentage Self-Sufficient c Earnings Labor Force a Unemployed b All Adults $23, Education Less than high school , High school , Some college , Bachelor s degree , Advanced degree , Age Less than , to , to , to , to , to , to , to , to , and older , Race White , Black , Ethnicity Hispanic d , a b c d Out of labor force means not employed and not currently seeking a job. Unemployed means not employed and currently seeking a job. Adult self-sufficiency is defined as having sufficient resources to maintain the adults in a family above the official poverty level. Hispanic may include persons of any race. Source: Calculations by the authors from the March 1993 Current Population Survey. See Current Population Survey [CD-ROM], U.S. Bureau of the Census, Available from U.S. Department of Commerce, Bureau of the Census, P.O. Box , Atlanta, GA not attain family self-sufficiency. Of these 15.7% of adults, only 1.3% were raised out of poverty by cash assistance from federal programs such as Aid to Families with Dependent Children (AFDC, welfare payments to low-income families with children) and Supplemental Security Income (SSI, payments to low-income persons of all ages with disabilities). Thus, even with cash assistance, 14.4% of all adults with children in 1992 remained in poverty. While the dollar amount of actual cash transfers to poor families that year was $20.7 billion, the poverty gap the dollar amount needed to raise all poor families above the official poverty line was $58.5 billion, more than twice the amount provided. 4,8 Why Is the Poverty Rate So Much Higher for Children Than for Adults? To this point, the focus of the discussion has been on poverty among adults who live with children. If children were randomly distributed among all adults with children, then the child poverty rate would be the same as the poverty rate of adults with children. However, the rate of poverty among children 21.9% in 1992 was much higher than the 14.4% poverty rate among adults

7 Why So Many Children Are Poor 31 Table 2 Why Are Children Poor? Decomposition of the 1992 Child Poverty Rate Reasons for Child Poverty Percentage-Point Contribution to Child Poverty Rate 1. Children who live with adults who lack adult self-sufficiency Children who live with adults who are self-sufficient but lack the 4.6 additional income to also support their children, even counting means-tested cash benefits 3. Children who live in poverty because of the demographic 7.5 structure of their household 1992 Child Poverty Rate (sum of factors 1 through 3) 21.9 Source: Calculations by the authors from the March 1993 Current Population Survey. See Current Population Survey [CD- ROM], U.S. Bureau of the Census, Available from U.S. Department of Commerce, Bureau of the Census, P.O. Box , Atlanta, GA with children. This 7.5 percentage-point difference results because poor families have more children per adult than the population as a whole. Calculations based on the March 1993 Current Population Survey show that poor families have 1.61 children per adult, which is much higher than the 0.93 children per adult in nonpoor families with children. 9 The higher ratio in poor families is, in turn, attributable to two other characteristics of poor families. First, poor families with children have fewer adults than nonpoor families with children. For example, 55.7% of poor families with children have only one adult, while only 13.9% of nonpoor families with children have only one adult. The much discussed high rate of divorce and relatively high rate of nonmarital births both contribute to there being fewer adults in poor families with children. Second, poor families with children have more children on average (2.24 per family) as compared to nonpoor families with children (1.79 per family). Most children who live with either a nonmarried or a divorced parent do, in fact, have another parent who lives elsewhere. If the family were thought of as a combination of those two units, the rate of child poverty might be substantially lower. Thus, the higher poverty rate for children in one-parent families reflects demographic circumstances, not necessarily the economic circumstances of all the relevant adult family members. This distinction underlies the policy efforts in recent years to tie the economic wellbeing of children to the economic circumstances of both of their biological parents. Summary Table 2 summarizes the reasons for child poverty. Nearly 10% of children would be poor even if children were distributed uniformly among adults. The reasons for that amount of child poverty, then, are directly related to the reasons for adult poverty the skills and labor supply of workers and the market demands for labor of various types. Another 4.6% of children live in families in which the adults achieve self-sufficiency but do not earn or receive enough income to cover the additional needs of their children. An additional 7.5% of children are poor because they live in families with more children per adult than the average family. This particular breakdown of the child poverty rate is but one of the many ways one might partition and think about the causes of child poverty. Because this dichotomy distinguishes between how adults fare in earning sufficient income for themselves and their children on the one hand, and how adults structure their families in terms of the number of adults and number of children on the other hand, it suggests how different social policies may affect child poverty. Policies such as job training and education directed at increasing adults earnings

8 32 THE FUTURE OF CHILDREN SUMMER/FALL 1997 will increase their chances of providing for themselves and their children. Such policies can have a secondary salutary impact on child poverty in the long run if these moreeducated adults then choose to have fewer children. Of course, not all policies may have multiple impacts that reinforce one another. Consider the proposal to cap welfare benefits to a mother who has an additional child while already receiving assistance. If this family cap policy were successful in limiting the number of children born to the poor, it would lower the average number of children per adult in poor families and decrease child poverty by reducing the gap between adult and child poverty rates. However, it would also limit the effectiveness of cash transfers in aiding adults in meeting their family s needs. Unless adults met the increased needs of their families through increased earnings, adult poverty would rise, and correspondingly, so too would child poverty. Trends in Poverty for Children As shown in Figure 1, the child poverty rate has followed a U-shaped pattern over the past 35 years, and the gap between the child and adult poverty rates has been larger in recent years than in earlier years. The decline in poverty from the late 1950s into The official poverty measure does not accurately reflect the relative economic well-being of all families. the 1970s was, in large part, a product of the growth in the economy, which explains why that decline in poverty is seen for both children and adults. In the latter half of the 1960s, there was also a major effort through social legislation and cash transfer programs the war on poverty to alleviate poverty directly, and that program appears to have had an effect in those initial years. Since the early 1970s, the growth of the economy has slowed, and since the mid- 1970s, the real value of cash transfer programs for children (that is, AFDC) has declined, while retirement income and Social Security provisions for the elderly have continued to rise. Thus, social policy itself may be a primary reason for the growth in recent years in the poverty rate for children as compared with that for adults. When the overall economy is playing the key role, as in the early time period covered by Figure 1, the experiences of children and adults are similar; when social policy plays the central role in the pattern of poverty over time, then the rates for demographic groups can and often will differ. The relatively stronger commitment to addressing the needs of the elderly as compared with those of children in recent decades is part of the explanation for the rise in child poverty relative to adult poverty. However, it bears mentioning that the trends evident in Figure 1 are based on the official poverty measure, which, as is discussed in the next section, does not accurately reflect the relative economic wellbeing of all families. To the extent that social policy designed to aid children is not reflected in the official measure while policies to aid the elderly are, the trends in Figure 1 overstate the decline in children s well-being relative to that of adults. As discussed in the article by Currie in this journal issue, the proportion of aid to children that is given in kind (for example, the Special Supplemental Food Program for Women, Infants, and Children (WIC), school lunches, and Head Start) and, therefore, not counted in the official poverty measure s definition of a family s income relative to the proportion that is given as cash and counted in the official measure has risen steadily over the past 20 years. Thus, children have benefitted in ways not apparent in the official poverty measure and not apparent in the trends shown in Figure 1. A New Poverty Measure In the Family Support Act of 1988, Congress called for a scientific review of the official U.S. measure of poverty, reflecting the general dissatisfaction with that measure, which had not been revised since the mid-1960s. The National Research Council (NRC) of the National Academy of Sciences undertook that review through a panel of academics of which the authors were members. That panel s recommendations were made in May 1995 and called for a new approach to poverty measurement. 10 This section summarizes the NRC panel s arguments for

9 Why So Many Children Are Poor 33 changing the way poverty is measured in the United States and describes how the proposed changes affect the composition of the children who are in poverty. The NRC Panel s Critique and Recommendations The panel s critique of the official poverty measure emphasized that several judgments about the measure made in the 1960s are by now antiquated and erroneous, even if they had been satisfactory when they were introduced. For example, the panel identified several types of family resources that have increased since the mid-1960s but are currently excluded from income in the official measure. For instance, government transfer programs such as food stamps and public housing subsidies are excluded because the official poverty measure counts only monetary benefits like AFDC and does not consider in-kind benefits, despite the fact that they have become a key component of welfare policy. Many of these in-kind programs did not exist when the poverty measure was created, yet in recent years welfare policy has favored in-kind programs to provide assistance. In 1992, for example, total AFDC and SSI cash assistance was $47.7 billion, while inkind assistance programs totaled $56.2 billion. 11 To ignore these latter programs seriously overstates measured poverty. Another serious omission in the current measure of poverty, the NRC panel argued, is the practice of ignoring paid taxes. In the 1960s, the poor were practically exempted from federal income taxation, and very few states taxed low-income families; therefore, the only income-related tax paid by the poor was the Social Security payroll tax at 3% of earnings. Today, however, the poor are subject to considerably higher earnings taxes at both the federal and the state levels and also in Social Security taxes, which are currently at 7.56% of earnings. Failure to account for these higher taxes understates poverty. The panel argued that taxes should be taken into account by subtracting them from available resources. The official measure of poverty also ignores an important cash program administered through the tax code, the Earned Income Tax Credit (EITC). In 1992, this tax credit gave low-income households $9.6 billion of assistance, none of which was counted as income in the official measure of poverty. Ignoring this program, designed to aid working families with children, results in an overstatement of the number of poor children. In 1960, some 18.6% of married women with a child under six participated in the labor force; by 1994, this rate had more than tripled to 61.7%. The panel argued that this upward trend necessitates another change in the way poverty is measured. Certain child care costs should be subtracted from earnings available to meet poverty thresholds in families in which there are young children and no nonemployed adult at home. 12 Similarly, for each working adult, the panel recommended deducting a flat amount per week worked to account for work-related expenses such as transportation. To ignore these costs overstates available income and thereby understates the level of poverty. Another important trend in recent years that is not handled well in the official poverty measure is the rapid rise in health

10 34 THE FUTURE OF CHILDREN SUMMER/FALL 1997 care expenditures. Per capita medical spending in 1960 in real (1992) dollars was $698; by 1993, that figure had grown to $3,299. With a growing proportion of the population uninsured for health care, families today face an increased risk of medical spending. The NRC panel identified the issue of medical care spending as particularly problematic and recommended that the definition of family resources be altered to reflect the burden imposed by medical expenses. Another problem identified by the panel is that there is no recognition in the official poverty measure of differences in the cost of living across the United States, although the cost of housing in New York City, for example, is 162% higher than in rural Mississippi. To ignore the potentially Choice of a specific level for the poverty threshold cannot be determined by science alone and is appropriately determined by public debate and ultimately by public officials. large differences in the cost of living across regions and cities of different sizes tends to bias the measure of children in poverty toward identifying too many as impoverished in rural areas and in the South relative to children living in large metropolitan areas elsewhere. As indicated by this discussion, an improved measure of the income available to meet poverty thresholds would, in some instances, raise the number in poverty and, in other instances, lower that number. As income is currently measured, however, families are clearly ranked incorrectly by income, so the measure of which families are in poverty is flawed. Turning to threshold measurement, another fundamental issue addressed by the panel is how to update over time the dollar level of the poverty threshold, the line between poverty and sufficiency. If one thinks poverty should be defined by an absolute level of resources or needs, then updating poverty thresholds for changes in the cost of living using the Consumer Price Index, for example may be adequate. Alternatively, if one thinks poverty should be defined in comparison to the resources of an average family or a wealthy family, then the updating should be done in relation to the change in resources of that reference family. Although the United States is the only country with an official measure of poverty, many other nations informally use a relative measure for their poverty thresholds, often half the median income. The United Kingdom uses half the mean (not median) income as its poverty threshold; with this concept in particular, a family can become poor not because its income fell, but because another (even a very wealthy) family s income rose. There is no correct or incorrect answer to the question of whether to use an absolute or relative measure of poverty. However, the NRC panel noted the interesting pattern in Figure 2, which shows three potential measures of U.S. poverty thresholds over time, each expressed in real (1992) dollars: (1) the current poverty thresholds (an absolute measure of poverty); (2) one-half the median after-tax family income (a relative measure of poverty); and (3) the average response to a Gallup poll survey question, How much does a family of four need not to be considered poor? 13,14 Figure 2 shows that, in 1963, when the official (absolute) poverty threshold was set, there was consistency among the measures of what a family of four needed. But notice how unusual it was for those three measures to converge. Had our official (absolute) threshold been in place in the immediate post World War II period, it would have been considered far too high, and analogously by the subjective survey responses or the comparison to half-median income, it has been considered much too low in recent years. Although the official poverty thresholds are adjusted annually to reflect changes in prices, real threshold levels have never been changed, despite a nearly 30% increase in median after-tax incomes of four-person families since the mid-1960s when the thresholds were first introduced. The NRC panel argued for some upward adjustment in the poverty thresholds. Most important, it argued for a procedure that would update those thresholds over time as spending levels on necessities change.

11 Why So Many Children Are Poor 35 Figure 2 Absolute and Relative Measures of Poverty Thresholds for a Family of Four in the United States, 1947 to 1992 $20,000 $18,000 $16,000 $14,000 $12,000 $10,000 $8,000 $6, Annual Income (in 1992 dollars) Year Official poverty threshold a Subjective poverty threshold* Half of median after-tax family income a Subjective poverty threshold is the mean response to a national Gallup Poll survey question, How much does a family of four need not to be considered poor? Source: Citro, C., and Michael, R. Measuring poverty: A new approach. Washington, DC: National Academy Press, 1995, Tables 2-3 and 2-4. The choice of a specific level for the poverty threshold cannot be determined by science alone and is appropriately determined by public debate and ultimately by public officials. To narrow the debate, the panel recommended that any new poverty threshold should be based on how families actually spend their income on the necessities of food, clothing, and shelter, including utilities. Impact of the NRC Panel s New Measure of Poverty on Children For the purposes of this discussion, the threshold for a family of four is set so that the same number of children are counted as poor by the panel s concept of poverty as are poor under the current poverty measure. This exercise emphasizes the differences in which children are counted as poor, rather than emphasizing the impact that the choice of the threshold will have on the number of children who are counted as poor. This procedure reflects one of the key points made by the panel: setting the level of the threshold and, hence, the number of poor is principally a political judgment, but the ranking of families from the poor to the wealthier is less judgmental and can be based on scientific measurement. In 1992, the official poverty measure counted 14.6 million children as living in poverty. Holding constant that number of children but applying the panel s recommendations about the thresholds and the correct measure of the family s income level, it becomes apparent that as many as onesixth of the children counted as poor by this new measure were not poor by the official measure. That is, 2.4 million children who are counted as poor in the official measure

12 36 THE FUTURE OF CHILDREN SUMMER/FALL 1997 live in families with incomes that are higher than another 2.4 million children who are not counted as poor in the official measure but who are poor according to the panel s proposed measure. The explanation for this reranking is that the new measure counts as family resources in-kind benefits such as food stamps and income tax credits and subtracts from available family resources nondiscretionary expenditures like paid taxes. Among the children who are newly in poverty in this exercise, many more reside with two parents: according to the official measure, 36% of poor children reside with two parents, while in the new measure, 43% do so. (For comparison, in the population as a whole, 73% of children live with two parents.) Similarly, the percentage of poor children living with at least one full-time When employment-related expenses are accounted for, many working families no longer have adequate resources to meet family needs. employed parent increased from 26% under the official measure to 35% under the panel s measure. The explanation for both of these shifts is that, when employment-related expenses including child care and the taxes associated with the earnings are accounted for, many working families no longer have adequate resources to meet family needs. The racial and ethnic composition of poor children remains relatively unchanged through this exercise. While there are slightly more white children in poverty, black and Hispanic children remain overrepresented in the poverty population. Children who are classified as poor by the new measure are much less likely to be receiving a transfer payment from the government because, as one would hope, the receipt of benefits provides many families with resources that are sufficient to meet their needs. For those children who are no longer classified as poor, 71% lived in families that received AFDC or SSI, 87% lived in families that received food stamps, 43% lived in families that had housing subsidies, and 60% lived in families that received the EITC. The picture of the children reclassified as poor by the proposed measure is quite different. Five percent lived in families that received AFDC or SSI, 11% lived in families that received food stamps, 4% lived in families that received a subsidy for housing, but 74% of these children lived in families that received an EITC payment. As previously noted, the current poverty definition does not reflect any geographic differences in the cost of living. Adjusting the poverty thresholds to account for these differences creates a shift in the regional location of poor children from the South and the Midwest to the Northeast and the West. While the proportion of poor children living in the southern region declines, the South continues to have the highest proportion of poor children. Geographic cost-ofliving adjustments also reflect differences between rural and urban areas. After adjusting for these differences, there is a slight rise in the number of poor children in central cities and suburbs, with an offsetting decline in the proportion from rural areas. One final but important characteristic of poverty among children should be examined, the depth of child poverty. These measures focus on the amount of income inadequacy rather than on a count of the number of children who are poor. Figure 3 shows the proportion of children whose family s resources lie in the intervals less than 25%, 25% to 50%, 50% to 75%, or 75% to 100% of their family s needs as reflected by the poverty thresholds. Using the current, official measure of poverty, poor children are almost uniformly distributed among these four subpoverty categories. By contrast, using the NRC panel s measurement of poverty that takes into account the in-kind transfers and other adjustments, a much more optimistic picture emerges, with many more children in families closer to meeting their needs. Conclusion If the NRC panel s poverty measure were adopted, it would alter the statistical face of poor children, as compared with the current poverty measure. The revised measure provides a more accurate account of which children remain impoverished despite efforts by their parents and the government. With the

13 Why So Many Children Are Poor 37 Figure 3 Comparison of the Depth of Poverty Among Children Using the Current Poverty Measures and Those Proposed by the NRC Panel Percentage Current Poverty Measure NRC Panel Proposed Annual Family Resources as a Percentage of Poverty Threshold 0 to 25% 25% to 50% 50% to 75% 75% to 100% Source: Calculations by the authors from the March 1993 Current Population Survey. See Current Population Survey [CD-ROM], U.S. Bureau of the Census, Available from U.S. Department of Commerce, Bureau of the Census, P.O. Box , Atlanta, GA NRC panel s measure, poor children will continue to be disproportionately those living with a single parent and those who are black. In the panel s measure there is, however, a sizable increase in the portion of poor children who live in families where both parents are present, where at least one adult is working a full year, and where no governmental cash assistance is received. Many of these working, low-income, two-parent families are currently incorrectly not counted among the poor. In the first section of this article, the child poverty rate was decomposed emphasizing (1) the ability of parents to provide for themselves and for their children, and (2) the differences in the demographic structure of poor families compared with other families. It is instructive to look at that same decomposition using the panel s poverty measure. With that new measure, a larger proportion of the children in poverty live in households with two adults present. This implies a reduction in the number of children per adult in poor families with children and, hence, a narrowing of the gap between the poverty rates for adults and those for children. In fact, the average number of children per adult in poor families falls to 1.52 in the panel s poverty measure from 1.61 in the old measure, while the poverty rate of adults with children rises to 15.3% in the NRC s measure from 14.4% in the old measure. Also, with that new measure, a larger proportion of the children in poverty live with parents who are employed the full year. This implies that more adults should be able to achieve adult self-sufficiency. In fact, the proportion of adults with children who do not achieve adult self-sufficiency falls very slightly from 9.8% to 9.6% while the proportion of adults who fail to achieve family selfsufficiency rises to 5.7% from 4.6%. Finally, the new poverty measure takes account of the tax credits and noncash government assistance to families, which implies that the effect of these programs can now be measured. In the first section of this article, it was noted that only 0.9% of both adults and children were lifted from poverty

14 38 THE FUTURE OF CHILDREN SUMMER/FALL 1997 through means-tested cash assistance (AFDC and SSI). When the tax credits and in-kind benefits are also counted, 4.2% of adults with children and 5.3% of children are lifted out of poverty through governmental assistance. Clearly the old definition of poverty understates the contribution of the variety of governmental transfer programs to reducing child poverty. The United States has an official measure of poverty that has been utilized for more than 30 years and that has, ironically, become obsolete in part because of antipoverty initiatives. The NRC panel s recommended measure of poverty takes those initiatives into account and accommodates, as well, other social and economic changes that have taken place over the past three decades. As this nation moves toward devolution, with individual states initiating a wide variety of social welfare programs, it is essential that the national measure of poverty be sufficiently flexible to reflect the impact of those state policies. Some states may use cash payments, while others may use inkind transfers more extensively and still others may use vouchers or credits of some other kind. Unless the national measure of poverty accurately reflects the needs and the resources of families, there will be no way to determine which state s strategies work better and which work less well in alleviating poverty. 1. For an alternative view about the trend in child poverty over the past two decades, see Jencks, C., and Mayer, S.E. Do official poverty rates provide useful information about trends in children s economic welfare? Institute for Policy Research Working Paper, April 18, Lewit, E.M. Child indicators: Children in poverty. The Future of Children (Spring 1993) 3,1: One reason this is only a crude approximation is that the actual income has been taken by source that is, the earnings, the Social Security, and so on as if the presence or absence of children has no effect on these amounts, but in fact it surely does. There are important behavioral responses to the presence of children in terms of men and women s labor supply, the family s savings, and family stability and structure. The computations ignore these responses and simply count whether the income received in the year is sufficient to keep the adults living in the household out of poverty. 4. These calculations and all others in the first section of this article are based on calculations by the authors using data from the March 1993 Current Population Survey. See Current Population Survey (CD-ROM), U.S. Bureau of the Census, Available from U.S. Department of Commerce, Bureau of the Census, P.O. Box , Atlanta, GA There have been many excellent surveys of research findings on the determinants of earnings. These include Willis, R.J. Wage determinants: A survey and reinterpretation of human capital earnings functions. In Handbook of Labor Economics. O. Ashenfelter and R. Layard, eds. Amsterdam: North Holland, 1986, pp ; Levy, F., and Murnane, R.J. U.S. earnings levels and earnings inequality: A review of recent trends and proposed explanations. Journal of Economic Literature (September 1992) 30,3: ; and Blinder, A.S. The level and distribution of economic well-being. In The American Economy in Transition. M. Feldstein, ed. Chicago: University of Chicago Press for NBER, 1980, pp See Sawhill, I.V. Poverty in the U.S.: Why is it so persistent? Journal of Economic Literature (September 1988) 26,3: , and Lewit, E.M. Why is poverty increasing among children? The Future of Children. (Summer/Fall 1993) 3,2: Table 1 includes adults of all ages, both with and without children. Although the number of children ever born is negatively associated with the parent s educational attainment, in Table 1 that relationship is obscured by the inclusion of elderly adults who are both unlikely to have children present and quite likely to have a relatively low level of educational attainment. 8. This poverty gap is only a first approximation and would be a minimum amount because additional cash assistance would tend to lower the incentives of individuals to support themselves, so even more assistance might be needed to fill it. 9. To see why the difference between the adult poverty rate and the child poverty rate can be explained by the fact that poor families have more children per adult than the nonpoor population, consider the following example. The 14.4% poverty rate for adults with children conveys the information that 144 out of every 1,000 adults with children in the population will be

15 Why So Many Children Are Poor 39 poor. If every adult in the population has on average one child, then that 1,000 adults would represent 1,000 children as well. But if poor adults have, on average, say, 1.5 children, then the 144 poor adults would be living with 216 children, and the poverty rate for children would be about 40% higher than the poverty rate for adults. 10. Citro, C.F., and Michael, R.T., eds. Measuring poverty: A new approach. Washington, DC: National Academy Press, Programs included in this count were all food assistance programs, including food stamps and school breakfast and lunch programs, all housing programs such as Section 8 housing, and energy assistance programs. 12. The NRC panel recommended that these child care costs be capped at $2,400 for one child and $4,800 for two or more children. 13. The Gallup poll question was not asked after Denton R. Vaughan, Office of Research and Statistics, Social Security Administration, Washington, DC. Personal communication, February 10, Interpolations by the authors supplied missing data points for the following years: , 1965, 1968, 1972, , and

The Research SUPPLEMENTAL POVERTY MEASURE: 2010

The Research SUPPLEMENTAL POVERTY MEASURE: 2010 The Research SUPPLEMENTAL POVERTY MEASURE: 2010 Consumer Income Issued November 2011 P60-241 INTRODUCTION The current official poverty measure was developed in the early 1960s, and only a few minor changes

More information

820 First Street NE, Suite 510 Washington, DC 20002. Tel: 202-408-1080 Fax: 202-408-1056. center@cbpp.org www.cbpp.org.

820 First Street NE, Suite 510 Washington, DC 20002. Tel: 202-408-1080 Fax: 202-408-1056. center@cbpp.org www.cbpp.org. 820 First Street NE, Suite 510 Washington, DC 20002 Tel: 202-408-1080 Fax: 202-408-1056 center@cbpp.org www.cbpp.org January 5, 2011 DESPITE DEEP RECESSION AND HIGH UNEMPLOYMENT, GOVERNMENT EFFORTS INCLUDING

More information

Custodial Mothers and Fathers and Their Child Support: 2011

Custodial Mothers and Fathers and Their Child Support: 2011 Custodial Mothers and Fathers and Their Child Support: 2011 Current Population Reports By Timothy Grall Issued October 2013 P60-246 IntroductIon This report focuses on the child support income that custodial

More information

Changes in Health Insurance Coverage in the Great Recession, 2007-2010 John Holahan and Vicki Chen The Urban Institute Executive Summary

Changes in Health Insurance Coverage in the Great Recession, 2007-2010 John Holahan and Vicki Chen The Urban Institute Executive Summary I S S U E P A P E R kaiser commission on medicaid and the uninsured Changes in Health Insurance Coverage in the Great Recession, 2007-2010 John Holahan and Vicki Chen The Urban Institute Executive Summary

More information

Social Security Eligibility and the Labor Supply of Elderly Immigrants. George J. Borjas Harvard University and National Bureau of Economic Research

Social Security Eligibility and the Labor Supply of Elderly Immigrants. George J. Borjas Harvard University and National Bureau of Economic Research Social Security Eligibility and the Labor Supply of Elderly Immigrants George J. Borjas Harvard University and National Bureau of Economic Research Updated for the 9th Annual Joint Conference of the Retirement

More information

In Search of a Elusive Truth How Much do Americans Spend on their Health Care?

In Search of a Elusive Truth How Much do Americans Spend on their Health Care? In Search of a Elusive Truth How Much do Americans Spend on their Health Care? David M. Betson University of Notre Dame Introduction One of the main goals of research this year has been the construction

More information

CONGRESS OF THE UNITED STATES CONGRESSIONAL BUDGET OFFICE CBO. The Distribution of Household Income and Federal Taxes, 2008 and 2009

CONGRESS OF THE UNITED STATES CONGRESSIONAL BUDGET OFFICE CBO. The Distribution of Household Income and Federal Taxes, 2008 and 2009 CONGRESS OF THE UNITED STATES CONGRESSIONAL BUDGET OFFICE Percent 70 The Distribution of Household Income and Federal Taxes, 2008 and 2009 60 50 Before-Tax Income Federal Taxes Top 1 Percent 40 30 20 81st

More information

Introduction to the Supplemental Security Income (SSI) Program

Introduction to the Supplemental Security Income (SSI) Program 820 First Street NE, Suite 510 Washington, DC 20002 Tel: 202-408-1080 Fax: 202-408-1056 center@cbpp.org www.cbpp.org Revised February 27, 2014 Introduction to the Supplemental Security Income (SSI) Program

More information

Global Demographic Trends and their Implications for Employment

Global Demographic Trends and their Implications for Employment Global Demographic Trends and their Implications for Employment BACKGROUND RESEARCH PAPER David Lam and Murray Leibbrandt Submitted to the High Level Panel on the Post-2015 Development Agenda This paper

More information

SINGLE MOTHERS SINCE 2000: FALLING FARTHER DOWN 1

SINGLE MOTHERS SINCE 2000: FALLING FARTHER DOWN 1 SINGLE MOTHERS SINCE 2000: FALLING FARTHER DOWN 1 For the one in four U.S. families who are single mother families, the Great Recession of 2008-2009 exacerbated a period of losing ground that had started

More information

Rural Poverty At A Glance

Rural Poverty At A Glance Rural Poverty At A Glance During the 199s, America experienced unprecedented economic growth and a large decline in the national poverty rate. Between 1993 and, real GDP (gross domestic product adjusted

More information

APPENDIX A The PSID Sample and Family Income

APPENDIX A The PSID Sample and Family Income 1 APPENDIX A The PSID Sample and Family Income The sample for this analysis is 2,367 individuals who were between the ages of 0 and 18 in 1968 and have been tracked into adulthood through the Panel Study

More information

Undergraduate Degree Completion by Age 25 to 29 for Those Who Enter College 1947 to 2002

Undergraduate Degree Completion by Age 25 to 29 for Those Who Enter College 1947 to 2002 Undergraduate Degree Completion by Age 25 to 29 for Those Who Enter College 1947 to 2002 About half of those who start higher education have completed a bachelor's degree by the ages of 25 to 29 years.

More information

Demographic Analysis of the Salt River Pima-Maricopa Indian Community Using 2010 Census and 2010 American Community Survey Estimates

Demographic Analysis of the Salt River Pima-Maricopa Indian Community Using 2010 Census and 2010 American Community Survey Estimates Demographic Analysis of the Salt River Pima-Maricopa Indian Community Using 2010 Census and 2010 American Community Survey Estimates Completed for: Grants & Contract Office The Salt River Pima-Maricopa

More information

Profile of Rural Health Insurance Coverage

Profile of Rural Health Insurance Coverage Profile of Rural Health Insurance Coverage A Chartbook R H R C Rural Health Research & Policy Centers Funded by the Federal Office of Rural Health Policy www.ruralhealthresearch.org UNIVERSITY OF SOUTHERN

More information

ICI RESEARCH PERSPECTIVE

ICI RESEARCH PERSPECTIVE ICI RESEARCH PERSPECTIVE 0 H STREET, NW, SUITE 00 WASHINGTON, DC 000 0-6-800 WWW.ICI.ORG OCTOBER 0 VOL. 0, NO. 7 WHAT S INSIDE Introduction Decline in the Share of Workers Covered by Private-Sector DB

More information

High School Dropouts in Chicago and Illinois: The Growing Labor Market, Income, Civic, Social and Fiscal Costs of Dropping Out of High School

High School Dropouts in Chicago and Illinois: The Growing Labor Market, Income, Civic, Social and Fiscal Costs of Dropping Out of High School High School Dropouts in Chicago and Illinois: The Growing Labor Market, Income, Civic, Social and Fiscal Costs of Dropping Out of High School Prepared by: Andrew Sum Ishwar Khatiwada Joseph McLaughlin

More information

The Effects of Medicaid Expansions on Insurance Coverage of Children

The Effects of Medicaid Expansions on Insurance Coverage of Children 152 REVISITING THE ISSUES The Effects of Medicaid Expansions on Insurance Coverage of Children Lisa C. Dubay Genevieve M. Kenney Lisa C. Dubay, Sc.M., is senior research associate at the Health Policy

More information

The Risk of Losing Health Insurance Over a Decade: New Findings from Longitudinal Data. Executive Summary

The Risk of Losing Health Insurance Over a Decade: New Findings from Longitudinal Data. Executive Summary The Risk of Losing Health Insurance Over a Decade: New Findings from Longitudinal Data Executive Summary It is often assumed that policies to make health insurance more affordable to the uninsured would

More information

The current official U.S. poverty measure has been not only an important

The current official U.S. poverty measure has been not only an important Use of the Poverty Measure in Government Assistance Programs 7 The current official U.S. poverty measure has been not only an important statistical indicator; it has also had direct policy uses in government

More information

Young Black America Part Four: The Wrong Way to Close the Gender Wage Gap

Young Black America Part Four: The Wrong Way to Close the Gender Wage Gap Issue Brief August 2015 Young Black America Part Four: The Wrong Way to Close the Gender Wage Gap By Cherrie Bucknor* Young blacks in America have had significant improvements in educational attainment

More information

A Hand Up: An Earned Income Credit Will Help Working Families

A Hand Up: An Earned Income Credit Will Help Working Families A Hand Up: An Earned Income Credit Will Help Working Families (revised January, 2008) Michael Wood and Sharon Ward Pennsylvania Budget and Policy Center The Pennsylvania House of Representatives is considering

More information

Marriage and divorce: patterns by gender, race, and educational attainment

Marriage and divorce: patterns by gender, race, and educational attainment ARTICLE OCTOBER 2013 Marriage and divorce: patterns by gender, race, and educational attainment Using data from the National Longitudinal Survey of Youth 1979 (NLSY79), this article examines s and divorces

More information

Social Security: Vital to Retirement Security for 35 Million Women and Men

Social Security: Vital to Retirement Security for 35 Million Women and Men IWPR Publication #D487 March 2010 Social Security: Vital to Retirement Security for 35 Million Women and Men Jeff Hayes, Heidi Hartmann, and Sunhwa Lee This Briefing Paper examines major sources of income

More information

Where Have All the Good Jobs Gone?

Where Have All the Good Jobs Gone? Where Have All the Good Jobs Gone? John Schmitt and Janelle Jones July 2012 Center for Economic and Policy Research 1611 Connecticut Avenue, NW, Suite 400 Washington, D.C. 20009 202-293-5380 www.cepr.net

More information

Canada Social Report. Social Policy Record, Child Benefits

Canada Social Report. Social Policy Record, Child Benefits Canada Social Report Social Policy Record, Child Benefits Child benefits are intended to assist families with the expenses associated with raising children. The first child benefit was created in 1918

More information

Women s Participation in Education and the Workforce. Council of Economic Advisers

Women s Participation in Education and the Workforce. Council of Economic Advisers Women s Participation in Education and the Workforce Council of Economic Advisers Updated October 14, 214 Executive Summary Over the past forty years, women have made substantial gains in the workforce

More information

The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings

The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings Special Studies Issued July 2002 P23-210 Does going to school pay off? Most people think so. Currently, almost 90 percent

More information

Who is making ends meet in the Portland region?

Who is making ends meet in the Portland region? Who is making ends meet in the Portland region? A profile of poverty and self-sufficiency among greater Portland families CC image courtesy of Holly Hayes on Flickr June 2015 Jamin Kimmell, M.U.R.P. Sheila

More information

NATIONAL BABY FACTS. Infants, Toddlers, and Their Families in the United States THE BASICS ABOUT INFANTS AND TODDLERS

NATIONAL BABY FACTS. Infants, Toddlers, and Their Families in the United States THE BASICS ABOUT INFANTS AND TODDLERS NATIONAL BABY FACTS Infants, Toddlers, and Their Families in the United States T he facts about infants and toddlers in the United States tell us an important story of what it s like to be a very young

More information

College: A Necessity Priced as a Luxury

College: A Necessity Priced as a Luxury College: A Necessity Priced as a Luxury Six Facts on College and the Middle Class May 2014 A Middle Class Job Does Not Get a Middle Class Life v Today, a middle class job increasingly does not support

More information

Coresident Grandparents and Grandchildren

Coresident Grandparents and Grandchildren Current Population Reports Special Studies C E N S U S B U R E A U Coresident Grands and Grandchildren By Ken Bryson and Lynne M. Casper P23-198 Issued May 1999 Figure 1. Grandchildren in Grands Home by

More information

By Melissa S. Kearney, Brad Hershbein, and Elisa Jácome The Hamilton Project

By Melissa S. Kearney, Brad Hershbein, and Elisa Jácome The Hamilton Project PROFILES OF CHANGE: EMPLOYMENT, EARNINGS, AND OCCUPATIONS FROM 1990-2013 April 20, 2015 By Melissa S. Kearney, Brad Hershbein, and Elisa Jácome The Hamilton Project There has been tremendous focus in recent

More information

Why Less-Skilled Immigration and Amnesty are so Costly to Taxpayers Testimony Prepared for Senate Committee on the Judiciary April 22, 2013

Why Less-Skilled Immigration and Amnesty are so Costly to Taxpayers Testimony Prepared for Senate Committee on the Judiciary April 22, 2013 Why Less-Skilled Immigration and Amnesty are so Costly to Taxpayers Testimony Prepared for Senate Committee on the Judiciary April 22, 2013 by Steven A. Camarota, Ph.D. Director of Research Center for

More information

Notes - Gruber, Public Finance Chapter 17 - Income distribution and Welfare programs Welfare policy in the United States Motivations - relative

Notes - Gruber, Public Finance Chapter 17 - Income distribution and Welfare programs Welfare policy in the United States Motivations - relative Notes - Gruber, Public Finance Chapter 17 - Income distribution and Welfare programs Welfare policy in the United States Motivations - relative income inequality, income distribution: The evolution of

More information

Rural America At A Glance

Rural America At A Glance United States Department of Agriculture Rural America At A Glance 2014 Edition Overview While the U.S. economy is now in its sixth year of recovery from the Great Recession of 2007-09, its performance

More information

Employment in the United States is recovering slowly from the

Employment in the United States is recovering slowly from the Employment Patterns During the Recovery: Who Are Getting the Jobs and Why? By Ayşegül Şahin and Jonathan L. Willis Employment in the United States is recovering slowly from the Great Recession. After declining

More information

Long Island is rapidly losing its lead in private health care coverage. That distinctive mark of middle class success - private

Long Island is rapidly losing its lead in private health care coverage. That distinctive mark of middle class success - private RESEARCH REPORT Regional Labor Review Fall 1998 Long Island s Ailing Health Care Benefits by Niev Duffy Long Island is rapidly losing its lead in private health care coverage. That distinctive mark of

More information

Personal debt ON LABOUR AND INCOME

Personal debt ON LABOUR AND INCOME ON LABOUR AND INCOME Personal debt Although the economy and population are almost times the size of s, the two countries show several similarities. Both have relatively high per-capita income and living

More information

Brief 1 The State of North Carolina: Jobs, Poverty and Family. Jeannine Sato, Center for Child and Family Policy

Brief 1 The State of North Carolina: Jobs, Poverty and Family. Jeannine Sato, Center for Child and Family Policy Brief 1 The State of North Carolina: Jobs, Poverty and Family Jeannine Sato, Center for Child and Family Policy The connection among jobs, poverty and family well-being is well established. Research shows

More information

! At least 3.1 million women raising children as a single parent, or 36% of all single mothers, will receive no tax benefit from the Bush plan.

! At least 3.1 million women raising children as a single parent, or 36% of all single mothers, will receive no tax benefit from the Bush plan. March 5, 2001 Women and Children Last: The Bush Tax Cut Plan The President has proposed a tax cut plan that fails to offer any benefits to the lowestincome families, most of whom are headed by women and

More information

Summary. Abbas P. Grammy 1 Professor of Economics California State University, Bakersfield

Summary. Abbas P. Grammy 1 Professor of Economics California State University, Bakersfield The State of the Economy: Kern County, California Summary Abbas P. Grammy 1 Professor of Economics California State University, Bakersfield Kern County households follow national trends. They turned less

More information

How Equal Pay for Working Women would Reduce Poverty and Grow the American Economy*

How Equal Pay for Working Women would Reduce Poverty and Grow the American Economy* IWPR #C411 January 2014 How Equal Pay for Working Women would Reduce Poverty and Grow the American Economy* Heidi Hartmann, Ph.D., Jeffrey Hayes, Ph.D., and Jennifer Clark Persistent earnings inequality

More information

Women, Wages and Work A report prepared by the UNC Charlotte Urban Institute for the Women s Summit April 11, 2011

Women, Wages and Work A report prepared by the UNC Charlotte Urban Institute for the Women s Summit April 11, 2011 A report prepared by the UNC Charlotte Urban Institute for the Women s Summit April 11, 2011 A report prepared for the Women s Summit by the UNC Charlotte Urban Institute 1 Table of Contents Table of Contents...

More information

EBRI Databook on Employee Benefits Chapter1: Employee Benefits in the United States: An Introduction

EBRI Databook on Employee Benefits Chapter1: Employee Benefits in the United States: An Introduction EBRI Databook on Employee Benefits Chapter1: Employee Benefits in the United States: An Introduction UPDATED MARCH 2011 Employee benefits are intended to promote economic security by insuring against uncertain

More information

The dynamics of disconnection for low-income mothers

The dynamics of disconnection for low-income mothers The dynamics of disconnection for low-income mothers Pamela Loprest and Austin Nichols Pamela Loprest is Director of the Income and Benefits Policy Center at The Urban Institute; Austin Nichols is Senior

More information

Health Insurance Soars, But America s Next Generation Still Lives in Families Struggling to Make Ends Meet

Health Insurance Soars, But America s Next Generation Still Lives in Families Struggling to Make Ends Meet An In-Depth Look at 2014 Census Data and Policy Solutions to Address Poverty Health Insurance Soars, But America s Next Generation Still Lives in Families Struggling to Make Ends Meet Summary of Findings

More information

Volume URL: http://www.nber.org/books/feld87-2. Chapter Title: Individual Retirement Accounts and Saving

Volume URL: http://www.nber.org/books/feld87-2. Chapter Title: Individual Retirement Accounts and Saving This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: Taxes and Capital Formation Volume Author/Editor: Martin Feldstein, ed. Volume Publisher:

More information

PARTICIPATION STATUS AMONG VERY POOR FOOD STAMP ELIGIBLE HOUSEHOLDS

PARTICIPATION STATUS AMONG VERY POOR FOOD STAMP ELIGIBLE HOUSEHOLDS VI. PARTICIPATION STATUS AMONG VERY POOR FOOD STAMP ELIGIBLE HOUSEHOLDS As established in the previous chapter, while non-participants might not be participating because they are only temporarily poor,

More information

2 Fundamentals of Employee Benefit Programs

2 Fundamentals of Employee Benefit Programs PART ONE OVERVIEW 2 Fundamentals of Employee Benefit Programs CHAPTER 1 EMPLOYEE BENEFITS IN THE UNITED STATES: AN INTRODUCTION Employee benefits are intended to promote economic security by insuring against

More information

1960-61. United States

1960-61. United States 61-61 United States By, the U.S. population had surpassed 179 million, a gain of 19.0 percent from. The median age had decreased to 29.5 (28.7 for men and.3 for women), the first decline since 1900. The

More information

The goal is to transform data into information, and information into insight. Carly Fiorina

The goal is to transform data into information, and information into insight. Carly Fiorina DEMOGRAPHICS & DATA The goal is to transform data into information, and information into insight. Carly Fiorina 11 MILWAUKEE CITYWIDE POLICY PLAN This chapter presents data and trends in the city s population

More information

CENTER FOR LABOR MARKET STUDIES

CENTER FOR LABOR MARKET STUDIES The Complete Breakdown in the High Schoolto Work Transition of Young, Non College Enrolled High School Graduates in the U.S.; The Need for an Immediate National Policy Response Prepared by: Andrew Sum

More information

President Bush s Health Care Tax Deduction Proposal: Coverage, Cost and Distributional Impacts. John Sheils and Randy Haught

President Bush s Health Care Tax Deduction Proposal: Coverage, Cost and Distributional Impacts. John Sheils and Randy Haught www.lewin.com President Bush s Health Care Tax Deduction Proposal: Coverage, Cost and Distributional Impacts John Sheils and Randy Haught President Bush proposes to replace the existing tax exemption for

More information

A Half-Century of California Poverty

A Half-Century of California Poverty A Half-Century of California Poverty Robert G. Mogull California State University at Sacramento In this article, poverty statistics are examined over the past 50 years for insights on trends. Data were

More information

Health Insurance Data Brief #2

Health Insurance Data Brief #2 cepr Center for Economic and Policy Research Health Insurance Data Brief #2 Health Insurance Coverage in the United States By Heather Boushey and Joseph Wright 1 April 13, 2004 CENTER FOR ECONOMIC AND

More information

Projections of the Size and Composition of the U.S. Population: 2014 to 2060 Population Estimates and Projections

Projections of the Size and Composition of the U.S. Population: 2014 to 2060 Population Estimates and Projections Projections of the Size and Composition of the U.S. Population: to Population Estimates and Projections Current Population Reports By Sandra L. Colby and Jennifer M. Ortman Issued March 15 P25-1143 INTRODUCTION

More information

Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2010 Current Population Survey

Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2010 Current Population Survey September 2010 No. 347 Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2010 Current Population Survey By Paul Fronstin, Employee Benefit Research Institute LATEST

More information

Key Facts About Poverty and Income in Texas

Key Facts About Poverty and Income in Texas Key Facts About Poverty and Income in Texas U.S. Census American Community Survey 2013 data CPPP.org Why care about poverty? Research shows living in poverty is connected to negative outcomes, both for

More information

Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2012 Current Population Survey

Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2012 Current Population Survey September 2012 No. 376 Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2012 Current Population Survey By Paul Fronstin, Ph.D., Employee Benefit Research Institute

More information

Average Federal Income Tax Rates for Median-Income Four-Person Families

Average Federal Income Tax Rates for Median-Income Four-Person Families 820 First Street, NE, Suite 510, Washington, DC 20002 Tel: 202-408-1080 Fax: 202-408-1056 center@cbpp.org http://www.cbpp.org April 10, 2002 OVERALL FEDERAL TAX BURDEN ON MOST FAMILIES INCLUDING MIDDLE-

More information

OVERVIEW OF CURRENT SCHOOL ADMINISTRATORS

OVERVIEW OF CURRENT SCHOOL ADMINISTRATORS Chapter Three OVERVIEW OF CURRENT SCHOOL ADMINISTRATORS The first step in understanding the careers of school administrators is to describe the numbers and characteristics of those currently filling these

More information

Home Computers and Internet Use in the United States: August 2000

Home Computers and Internet Use in the United States: August 2000 Home Computers and Internet Use in the United States: August 2000 Special Studies Issued September 2001 P23-207 Defining computer and Internet access All individuals living in a household in which the

More information

For Immediate Release

For Immediate Release Household Income Trends May 2015 Issued July 2015 Gordon Green and John Coder Sentier Research, LLC For Immediate Release 1 Household Income Trends May 2015 Note This report on median household income

More information

SOME EXPERIMENTAL RESULTS ON ALTERNATE POVERTY MEASURES

SOME EXPERIMENTAL RESULTS ON ALTERNATE POVERTY MEASURES SOME EXPERIMENTAL RESULTS ON ALTERNATE POVERTY MEASURES Daniel H. Weinberg and Enrique J. Lamas U.S. Bureau of the Census, Washington DC 20233-3300 Key words: Poverty, Medical Benefits Formal measurement

More information

Parental Educational Attainment and Higher Educational Opportunity

Parental Educational Attainment and Higher Educational Opportunity Parental Educational Attainment and Higher Educational Opportunity Federal higher education policy recognizes certain student characteristics as limiting higher educational opportunity, and has created

More information

How do benefit adjustments for government transfer programs compare with their participants inflation experiences?

How do benefit adjustments for government transfer programs compare with their participants inflation experiences? How do benefit adjustments for government transfer programs compare with their participants inflation experiences? Leslie McGranahan and Anna L. Paulson Introduction and summary Millions of Americans rely

More information

Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2013 Current Population Survey

Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2013 Current Population Survey September 2013 No. 390 Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2013 Current Population Survey By Paul Fronstin, Ph.D., Employee Benefit Research Institute

More information

Generational Aspects of Medicare. David M. Cutler and Louise Sheiner * Abstract

Generational Aspects of Medicare. David M. Cutler and Louise Sheiner * Abstract Generational Aspects of Medicare David M. Cutler and Louise Sheiner * Abstract This paper examines the generational aspect of the current Medicare system and some stylized reforms. We find that the rates

More information

Number, Timing, and Duration of Marriages and Divorces: 2009

Number, Timing, and Duration of Marriages and Divorces: 2009 Number, Timing, and Duration of Marriages and Divorces: 2009 Household Economic Studies Issued May 2011 P70-125 INTRODUCTION Marriage and divorce are central to the study of living arrangements and family

More information

Prepared by: Andrew Sum Walter McHugh Jacqui Motroni Sheila Palma. Center for Labor Market Studies Northeastern University Boston, Massachusetts

Prepared by: Andrew Sum Walter McHugh Jacqui Motroni Sheila Palma. Center for Labor Market Studies Northeastern University Boston, Massachusetts High School Graduation Outcomes and College Enrollment Plans of Class of 2009 High School Students by Gender in The City of Boston and Selected Large Urban and Affluent School Districts Across the State

More information

Investment Company Institute and the Securities Industry Association. Equity Ownership

Investment Company Institute and the Securities Industry Association. Equity Ownership Investment Company Institute and the Securities Industry Association Equity Ownership in America, 2005 Investment Company Institute and the Securities Industry Association Equity Ownership in America,

More information

Income is the most common measure

Income is the most common measure Income Goal A healthy standard of living for all Income is the most common measure of socioeconomic status, and a strong predictor of the health of an individual or community. When assessing the health

More information

Jessica S. Banthin and Thomas M. Selden. Agency for Healthcare Research and Quality Working Paper No. 06005. July 2006

Jessica S. Banthin and Thomas M. Selden. Agency for Healthcare Research and Quality Working Paper No. 06005. July 2006 Income Measurement in the Medical Expenditure Panel Survey Jessica S. Banthin and Thomas M. Selden Agency for Healthcare Research and Quality Working Paper No. 06005 July 2006 Suggested citation: Banthin

More information

Declining Health Insurance in Low-Income Working Families and Small Businesses

Declining Health Insurance in Low-Income Working Families and Small Businesses ACA Implementation Monitoring and Tracking Declining Health Insurance in Low-Income Working Families and Small Businesses April 2012 John Holahan and Vicki Chen The Urban Institute Executive Summary Employer-sponsored

More information

The Nonprofit Sector in Brief 2014

The Nonprofit Sector in Brief 2014 CENTER ON NONPROFITS AND PHILANTHROPY The Nonprofit Sector in Brief 2014 Public Charities, Giving, and Volunteering Brice S. McKeever and Sarah L. Pettijohn October 2014 This brief highlights trends in

More information

June 18, 2013 Ways and Means Human Resources Subcommittee Hearing:

June 18, 2013 Ways and Means Human Resources Subcommittee Hearing: Statement for the Record: June 18, 2013 Ways and Means Human Resources Subcommittee Hearing: MORE SPENDING, LESS REAL HELP: REVIEWING HOW TODAY S FRAGMENTED WELFARE SYSTEM FAILS TO LIFT UP POOR FAMILIES

More information

Florida s Families and Children Below the Federal Poverty Level

Florida s Families and Children Below the Federal Poverty Level Florida s Families and Children Below the Federal Poverty Level Florida Senate Committee on Children, Families, and Elder Affairs Presented by: February 17, 2016 The Florida Legislature Office of Economic

More information

High School Dropouts in Chicago and Illinois: The Growing Labor Market, Income, Civic, Social and Fiscal Costs of Dropping Out of High School

High School Dropouts in Chicago and Illinois: The Growing Labor Market, Income, Civic, Social and Fiscal Costs of Dropping Out of High School High School Dropouts in Chicago and Illinois: The Growing Labor Market, Income, Civic, Social and Fiscal Costs of Dropping Out of High School Prepared by: Andrew Sum Ishwar Khatiwada Joseph McLaughlin

More information

The 2004 Report of the Social Security Trustees: Social Security Shortfalls, Social Security Reform and Higher Education

The 2004 Report of the Social Security Trustees: Social Security Shortfalls, Social Security Reform and Higher Education POLICY BRIEF Visit us at: www.tiaa-crefinstitute.org. September 2004 The 2004 Report of the Social Security Trustees: Social Security Shortfalls, Social Security Reform and Higher Education The 2004 Social

More information

Issue Brief. Women and Health Coverage: The Affordability Gap. Elizabeth M. Patchias and Judy Waxman National Women s Law Center * * * * *

Issue Brief. Women and Health Coverage: The Affordability Gap. Elizabeth M. Patchias and Judy Waxman National Women s Law Center * * * * * APRIL 2007 Issue Brief Women and Health Coverage: The Affordability Gap Elizabeth M. Patchias and Judy Waxman National Women s Law Center For more information about this study, please contact: Elizabeth

More information

America Is Changing. National Conference of State Legislatures. August 15, 2013 Atlanta, GA

America Is Changing. National Conference of State Legislatures. August 15, 2013 Atlanta, GA America Is Changing National Conference of State Legislatures August 15, 2013 Atlanta, GA Race and Immigration Family, Marriage and Gender Young and Old Share of U.S. Population Growth by Race and Ethnicity,

More information

Executive Summary The Macroeconomic Effects of an Add-on Value Added Tax

Executive Summary The Macroeconomic Effects of an Add-on Value Added Tax The Macroeconomic Effects of an Add-on Value Added Tax Prepared for the National Retail Federation Prepared by Drs. Robert Carroll, Robert Cline, and Tom Neubig Ernst & Young LLP and Drs. John Diamond

More information

The Effect of Taxes and Transfers on Income and Poverty in the United States: 2005

The Effect of Taxes and Transfers on Income and Poverty in the United States: 2005 The Effect of Taxes and Transfers on Income and Poverty in the United States: 2005 Consumer Income Issued March 2007 P60-232 INTRODUCTION losses, and work expenses) varies at a This report examines how

More information

College Enrollment Hits All-Time High, Fueled by Community College Surge

College Enrollment Hits All-Time High, Fueled by Community College Surge Enrollment Hits All-Time High, Fueled by Community Surge FOR RELEASE: OCTOBER 29, 2009 Paul Taylor, Project Director Richard Fry, Senior Researcher Wendy Wang, Research Associate Daniel Dockterman, Research

More information

Policy Forum. Racial and Ethnic Health Disparities in Illinois: Are There Any Solutions?

Policy Forum. Racial and Ethnic Health Disparities in Illinois: Are There Any Solutions? Policy Forum I N S T I T U T E O F G O V E R N M E N T&P U B L I C A F F A I R S I N S T I T U T E O F G O V E R N M E N T&P U B L I C A F F A I R S Racial and Ethnic Health Disparities in Illinois: Are

More information

What Every Worker Needs to Know About an Unreformed Social Security System. July 29, 2014

What Every Worker Needs to Know About an Unreformed Social Security System. July 29, 2014 What Every Worker Needs to Know About an Unreformed Social Security System Statement before the Subcommittee on Social Security Committee on Ways and Means United States House of Representatives July 29,

More information

In preparing the February 2014 baseline budget

In preparing the February 2014 baseline budget APPENDIX B Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act In preparing the February 2014 baseline budget projections, the Congressional Budget Office () and the staff

More information

The Economists Voice

The Economists Voice The Economists Voice Volume 2, Issue 4 2005 Article 3 Does College Still Pay? Lisa Barrow Cecilia Elena Rouse Summary Since the mid-1990s college tuition costs have risen quickly while the rate of increase

More information

A Project of the ASU College of Public Programs Debra Friedman, Dean

A Project of the ASU College of Public Programs Debra Friedman, Dean GREATER PHOENIX FORWARD Sustaining and Enhancing the Human-Services Infrastructure This section provided as an excerpt of the larger publication available at copp.asu.edu A Project of the ASU College of

More information

MINIMUM WAGES AND THE CALIFORNIA ECONOMY

MINIMUM WAGES AND THE CALIFORNIA ECONOMY SEPTEMBER SEPT 2005 2005 I I R P O L I C Y B R I E F MINIMUM WAGES AND THE CALIFORNIA ECONOMY The Economic Impact of AB 48 IIR INSTITUTE OF INDUSTRIAL RELATIONS UNIVERSITY OF CALIFORNIA, BERKELEY MICHAEL

More information

POVERTY AND THE EARNED INCOME TAX CREDIT

POVERTY AND THE EARNED INCOME TAX CREDIT POVERTY AND THE EARNED INCOME TAX CREDIT Mindy Ault & Cherrie Bucknor Abstract: Using the March 2012 Annual Social and Economic Supplement to the Current Population Survey, we estimated the effect of receiving

More information

PENSIONS AT A GLANCE 2009: RETIREMENT INCOME SYSTEMS IN OECD COUNTRIES UNITED STATES

PENSIONS AT A GLANCE 2009: RETIREMENT INCOME SYSTEMS IN OECD COUNTRIES UNITED STATES PENSIONS AT A GLANCE 29: RETIREMENT INCOME SYSTEMS IN OECD COUNTRIES Online Country Profiles, including personal income tax and social security contributions UNITED STATES United States: pension system

More information

Are Women Opting Out? Debunking the Myth

Are Women Opting Out? Debunking the Myth BRIEFING PAPER November 2005 Are Women Opting Out? Debunking the Myth BY HEATHER BOUSHEY Executive Summary A front page article in the New York Times (Story 2005) recently reported that women at Yale University

More information

Volume Title: The Measurement of Saving, Investment, and Wealth. Volume Author/Editor: Robert E. Lipsey and Helen Stone Tice, editors

Volume Title: The Measurement of Saving, Investment, and Wealth. Volume Author/Editor: Robert E. Lipsey and Helen Stone Tice, editors This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: The Measurement of Saving, Investment, and Wealth Volume Author/Editor: Robert E. Lipsey

More information

THE MAGNITUDE AND CAUSES OF ARIZONA S LOW PER CAPITA INCOME

THE MAGNITUDE AND CAUSES OF ARIZONA S LOW PER CAPITA INCOME THE MAGNITUDE AND CAUSES OF ARIZONA S LOW PER CAPITA INCOME February 2010 Dennis Hoffman, Ph.D. Professor, Department of Economics; Director, L. William Seidman Research Institute; and Director, Office

More information

Pew Study: American Middle Class is Steadily Shrinking

Pew Study: American Middle Class is Steadily Shrinking Pew Study: American Middle Class is Steadily Shrinking December 23, 2015 by Gary D. Halbert of ProFutures Investments IN THIS ISSUE: 1. Pew Research: American Middle Class is Steadily Shrinking 2. Pew

More information

Seasonal Workers Under the Minnesota Unemployment Compensation Law

Seasonal Workers Under the Minnesota Unemployment Compensation Law Seasonal Workers Under the Minnesota Unemployment Compensation Law EDWARD F. MEDLEY* THE PAYMENT of unemployment benefits to seasonal has raised practical and theoretical problems since unemployment compensation

More information

ON LABOUR AND INCOME. JUNE 2002 Vol. 3, No. 6 HOUSING: AN INCOME ISSUE PENSIONS: IMMIGRANTS AND VISIBLE MINORITIES.

ON LABOUR AND INCOME. JUNE 2002 Vol. 3, No. 6 HOUSING: AN INCOME ISSUE PENSIONS: IMMIGRANTS AND VISIBLE MINORITIES. Catalogue no. 75-001-XIE ON LABOUR AND INCOME JUNE 2002 Vol. 3, No. 6 HOUSING: AN INCOME ISSUE PENSIONS: IMMIGRANTS AND VISIBLE MINORITIES Statistics Canada Statistique Canada Sophie Lefebvre HOUSING IS

More information